S&P 500 Oversold Bounce Is Right on Schedule, but We're Not Out of the Woods Yet

"A fool may earn money, but it takes a wise man to keep it." -- Scottish proverb

NEW YORK (TheStreet) -- We saw a decent bounce today right on schedule after being very oversold and seeing a Doji bar print in the S&P 500 (SPY), Nasdaq (QQQ) and Russell 2000 (IWM) Friday.

I didn't do much today, but we did take a small trade in Priceline.com (PCLN), as it broke my buy point at $1,260. We used weekly calls and bought them for $11 and sold in tranches at $23.60, $31 and $34.

Some nice quick gains for sure -- but the stocks did rest a while before continuing higher by another $15. I should have held some more longer, but I can't be too greedy in this market.

I'm mostly focused on quicker trades with large profit potential at the moment, while major moves are still setting up. I can't promise those types of moves all the time like we saw in Priceline today, but real-time members will get them if I can spot them during the day.

Let's move right to the index chart.

The S&P 500 bounced well after the doji bar Friday. It is too early to tell if it's forming a bear flag or not yet, but the 50-day average at $195.17 will almost assuredly cause some resistance.

This isn't a huge bounce so far, and on low volume, but we don't need a huge move to blow off the oversold reading we just had.  Even some sideways action will do it.

Still, cash is a good position -- or some quick trades. Have a great night.

At the time of publication, the author held no positions in any of the stocks mentioned, although positions may change at any time.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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